CHS sells 2 hospitals for $45M to drive down debt

Franklin, Tenn.-based Community Health Systems has signed a definitive agreement to sell Yakima (Wash.) Regional Medical Center & Cardiac Center and Toppenish (Wash.) Community Hospital to Sunnyside (Wash.) Community Hospital & Clinics for approximately $45 million.

Yakima Regional and Toppenish Community Hospital are two of the 71 hospitals CHS acquired from Naples, Fla.-based Health Management Associates in 2014.

The deal to sell the two hospitals is one of seven divestiture transactions CHS has in the works. During a third-quarter earnings call in November, CHS Chairman and CEO Wayne T. Smith said the company is working on selling 17 hospitals, as well as home care and nonhospital real estate, to further reduce its debt.

Commenting on the agreement to sell the Washington hospitals, Mr. Smith said on Tuesday, "We are making progress with our strategic objective to divest a number of properties to focus on a more sustainable portfolio of hospitals and networks for the future."

The transaction, which is subject to customary regulatory approvals, is expected to close in the second quarter of 2017.

CHS is divesting other Washington hospitals as well. In November, CHS signed a definitive agreement to sell Spokane, Wash.-based Rockwood Health System to Tacoma, Wash.-based MultiCare for $425 million. That transaction is expected to close in the first quarter of next year.